ATV2 or ATV3 and will it work from the box?

I am new to this forum but have been doing quite a bit of research and have a couple of iOS devices, but not the Mac. In a nutshell, am on the verge of splashing out on an ATV but have a couple of questions first, having read of all the pros and cons.

First, which one would be the better buy, the 2 or 3? Have heard that a few folks are having problems with ATV3 and Netflix.....also are they retailing for the same price? What basically is the difference btwn the two?

My primary usage would be the Netflix subscription for movies since I already have the mail version but would now like streaming them instead. Home photos and music files from my non-Apple laptops (both Dells using Windows XP). No need for any games....Have high-speed, broadband Internet connex, too.

The rest of the set-up is as follows:

TV: a Mitsubishi LCD HDTV (5 years old) capable 702/1080p with two HDMI slots. Currently receive cable through a CableCard - don't know how that will affect ATV, if at all. Currently, I cannot get anything "on-Demand" because the CableCard is a one-way device only (think of it as input only). That's OK because I did not want to have yet another box on top of everything else I have and the card is the size of credit card and slots into the back of the TV. You don't even see it and I get all the HD cable channels I want.

Sound System: a Bose Surround Sound CD/DVD player with Dolby Digital 5.1. That's what I current use for my DVD movies and audio CDs. Have 5 speakers with that.

Wireless Router: That is a brand new Netgear WNDR N6003700v3, dual-band (2.4 and 5.0GHz) set up in the office (next room to where the TV is). I do not wish to use the Ethernet connection for obvious reasons. It runs the wife's new iPad just fine as well as my iPhone 4S in the TV room.

And last but not least, I do have a HDMI cable.

Somewhere I read that the ATV has its own power source built-in, so requires no power cord. Is that true because elsewhere I read that it does? What do you get in the box? I do like the minimalist approach.

Based on the above current equipment, is there anything else I should know or do? And should I get the most current generation 3 or will the ATV2 do for what I want to use it for?

Any and all suggestions/tips/hints welcome!

Thanks for the info.

One final question re the ATV3: read an Amazon user's review that if you are using WiFi you cannot have any objects between the router and the ATV, otherwise you WIIL get drop offs and stoppages in the middle of a movie or song.

Anyone care to comment on this aspect?

My connection is WiFi and the router is in the NEXT room. I cannot change the set-up for logistical reasons. Besides, that's why I bought this particular router because it said it was a strong signal, designed for a medium to large house and effective to " streaming HD video". Agreed it's not the top of the range with all the bells and whistles. But like I said, I'm not interested in gaming, just movies and music.

Thanks for the replies.

Finally set it up last w/e and yes, it's pretty intuitive to set up, even fun!

And no problem with the wifi router in the next room.

Watched first Netflix movie, after sigining in and able to go through all the music stns.

Still learning but no problems so far!